A Post Office Savings Account is identical to a standard savings account in several respects. It is known to be a highly reliable instrument for the deposit of funds and provides the possibility, if necessary, of complete or partial liquidation of deposits. In particular, these accounts offer a fixed return on deposit and are suitable for retirees and individuals seeking to gain a guaranteed regular income.
Eligibility required to open a post office savings account
To open a savings account in post office you must meet with the below-listed eligibility criteria:
- Minor with a minimum age limit of 10 years old
- Up to three adults in case of joint account
- A guardian on behalf of minor or person with unsound mind
Post office savings account interest rate
The interest rate of the post office savings account is calculated by the central government from time to time. Interest is measured and paid annually on monthly deposits. As announced, Post Office Savings Accounts receive a fixed interest rate over the year, subject to adjustment from time to time. The interest rate is currently kept at 4%.
Key benefits of post office savings account
Some of the basic benefits of post office savings account are as follows:
- Account can be operated by minors over the age of 10 years
- Nomination facilities are accessible at the time of account opening and after account opening as well.
- One can claim a tax deduction up to Rs 10,000 per year
- Income tax exemption is applicable under the provisions of section 80L of the Income Tax Act for the interest received.
- It is possible to transfer an account from one post office to another and a single account can be converted to a joint account as well./
- In CBS Post offices, deposits and withdrawals can be done by any online format.
Features of post office savings account
Customers willing to open a savings account have access to the following features:
- One can avail for check facility for his or her existing account
- CBS Post Offices can issue ATM/Debit cards to those account holders who have preserved the specified minimum balance on the day of issuance of the debit card.
- Minors can use the Post Office Savings Account. An account can be opened in their name for minors under the age of 10, but the guardian will be granted the freedom to run the account on their behest. The account can be managed itself by minors aged 10 years and over.
- At the time of opening the account, the facility to nominate someone is provided under these accounts. The depositor can also opt to nominate a person at any time to receive the benefits of this account after their demise.
- Under the joint account facility, two or three adults are permitted to keep an account together. It's possible to turn a single account into a joint account and conversely.
- You only need to make one deposit or withdrawal within 3 financial years in order to keep the account active. The account will not be considered dormant until for 3 financial years if there are no transactions made.
- Withdrawal from post savings account
- The balance deposited can be withdrawn at any time as per the depositor's standards. All deposits/withdrawals should only be in rupees as a whole. At Rs 50, the minimum withdrawal limit is set. No withdrawal will be allowed if the account has balance lower than Rs 500. If the account balance is not increased to Rs. 500 at the end of the financial year, Rs. 100 will be withheld as Account Maintenance Fees and the account will automatically be discontinued if the account balance becomes zero.
Service charges applicable on post office savings account
Bear in mind that a few service charges are also available if you wish to open a post office savings scheme:
- Rs 50 to issue a duplicate cheque book
- Rs 20 to issue a deposit receipt
- Rs 20 to issue an account statement
- Rs 50 to cancel or change nomination
- Rs 10 to register for a new passbook
- No fee will be charged for up to 10 leaves in a fiscal year to issue a new cheque book. Rs 2 will be imposed to issue a cheque leaf after a fiscal year.
- Rs 100 to transfer an account
- Cheque dishonor fee: Rs 100
How to open a post office savings account online and offline?
India Post Office Post Office savings accounts can be opened online or offline. You must visit the branch, fill up the application form and submit KYC documents to open the Post Office offline.
- Visit the official portal of post office and navigate to the 'Savings Account' tab and click on 'Apply Now'
- Now enter the required details such as Name, Contact number, Date of Birth, Address etc. and click on 'Submit'
- As required by the bank, verify the details with documents such as PAN and Aadhaar or any other identity proof.
- All the KYC-documents submitted will be verified by the Post Office Executive.
- The Post Office will provide you with the welcome kit containing a debit cum ATM card, PIN and cheque book after the successful authentication of your documents.
- You can register your mobile number once the account is enabled and use a debit card and cheque book.
- Visit your nearest post office or India Post's official portal and get the application form to proceed.
- Fill out the application form completely with all required details.
- Provide the necessary KYC documents including a passport size photograph.
- Your account will activate within a week or so, and via a call/SMS/email, the bank will notify you about it.